Brief
Federal government withholds $1.2 billion in California Medicaid funding over fraud concerns
CMS Administrator Dr. Mehmet Oz announced the freeze, adding it follows a prior $1.3 billion hold on hospice and in‑home care payments.
By Felo News Desk · Published
Federal officials announced Tuesday that $1.2 billion in Medicaid reimbursements to California will be withheld, citing concerns about rapid growth and possible fraud in the state’s personal‑care program for seniors and people with disabilities.
Dr. Mehmet Oz, the administrator of the Centers for Medicare and Medicaid Services, said California’s personal‑care spending has risen 24 % over the past three years—twice the national average. He said the administration “cannot understand how that could be” and therefore is taking “major action in California.” Oz also questioned whether taxpayers are financing services that families might otherwise provide themselves.
The freeze adds to a $1.3 billion withholding announced in May that targeted suspected fraud in California’s hospice and in‑home care programs, bringing the total disputed federal Medicaid reimbursements to $2.5 billion.
Oz made the remarks from the White House alongside Vice President J.D. Vance, who serves as the administration’s fraud czar. The announcement coincided with President Donald Trump unveiling a new Justice Department whistleblower program that offers $30,000 bounties—and an additional 1 % commission on recovered funds—for tips leading to fraud charges.
While Oz highlighted the growth rate and raised questions about program integrity, he did not present specific evidence of fraud in the personal‑care program. The administration is reportedly seeking insider information to substantiate any wrongdoing.
Key facts
- The federal government is withholding $1.2 billion in Medicaid reimbursements to California. (nypost.com)
- California’s personal‑care spending grew 24 % over the past three years, double the national average. (nypost.com)
- A prior $1.3 billion withholding over hospice and in‑home care fraud was announced in May. (nypost.com)
- Vice President J.D. Vance was present as the administration’s fraud czar during the announcement. (nypost.com)
- The Justice Department launched a whistleblower program offering $30,000 bounties plus a 1 % commission on recovered funds. (nypost.com)
Sources
- [1] nypost.com — originally reported as “Feds defer $1.2B in California Medicaid funding in crackdown on suspected fraud”
